In 2020, Europe's war for tech talent will enter a new phase. It will no longer be about retaining and poaching exceptional talent. It will see companies competing with the potential of your own company. The most exceptional talent will want to become founders, and the venture ecosystem will respond, with a rise in “talent investors”.
There is a limited supply of exceptional talent, and up until now its sights have been set on traditional, parent-approved professional career paths, such as law and consulting. But this is changing.
The 2020 generation of talent sees “having an impact” as its primary career aim. A recent study by my organisation, Entrepreneur First, of two thousand 18 to 35-year-olds in the UK, found that more than a third believe that they aren’t meeting their full potential in their current career and wish they could have a greater impact. Nearly half envisaged setting up their own company as a vehicle to achieve this.
Alongside this shift in aspiration, it’s never been easier to start a company. The most talented now have easy access to the means of production to be a founder. The cost of technology has fallen dramatically and Europe has never had more venture capital – $23 billion was invested in 2018, up from $5 billion just five years earlier, according to VC investor Atomico.
Jacob Haddad is an example of this change. He left his successful career in health consulting to build his own medtech startup accuRx, a GP-patient messaging product used by one in three GP practices across the UK – transforming the way doctors interact with their patients.
There is an apparent opportunity cost to becoming a founder – loss of a stable job, a prestigious career path and rapidly increasing salary. But in 2020, talent will realise the opportunity cost is greater if you don’t found a startup.
As more potential founders enter the European ecosystem we will see investors create new ways to support these individuals financially to get access to early, well-priced deals. The seed ecosystem in Europe has become increasingly competitive.
At Entrepreneur First, we release 50 seed-stage startups a year into the European VC ecosystem. Two years ago, our top teams would get two competing term sheets – now it’s more than six. This level of competition means in 2020 we will see the rise of talent investors – venture capitalists who invest into an individual's potential, rather than into a company they have already founded, so they can get a seat at the table of Europe’s next unicorn.
Alice Bentinck is a co-founder of Entrepreneur First and Code First: Girls
This article was originally published by WIRED UK
